Trading Behavior in a Marginal Organized Market

As increasingly more transactions occur away from open markets, the so-called "thin" market issues arise. This paper analyzes unpublished transaction data from Egg Clearinghouse, Inc. (ECI), a marginal marketplace for eggs that trades 4% of all eggs (80% of eggs available for open trading). Results suggest that marginalized markets can serve as an inventory adjustment mechanism while maintaining the role of price discovery as a check for non-market prices. At ECI, most firms both buy and sell regardless of operational types, participation is balanced across all types of firms in the industry, and sellers in general yield to buyers' preferred terms of trade.


Subject(s):
Issue Date:
2005-12
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/30981
Published in:
Journal of Agricultural and Resource Economics, Volume 30, Number 3
Page range:
449-468
Total Pages:
20




 Record created 2017-04-01, last modified 2017-08-21

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